March 28 (Bloomberg) -- Ethanol fell to a five-week low in Chicago after a government report showed stockpiles near a record and as corn and gasoline declined.
Futures dropped after the Energy Department said supply fell 0.4 percent to 22.6 million barrels from a record 22.7 million the previous week. Corn, the primary ingredient in the fuel in the U.S., was down on speculation that farmers will boost acreage and gasoline slipped after oil inventories climbed the most in 20 months.
“You’re barely moving the needle in inventory declines,” said Jerrod Kitt, an analyst at Linn Group in Chicago. “It was very tame actually. The decline today had more to do with energies and corn being down.”
Denatured ethanol for April delivery slumped 4.1 cents, or 1.8 percent, to $2.207 a gallon on the Chicago Board of Trade, the lowest price since Feb. 22. Prices have fallen 11 percent in the past year.
In cash market trading, ethanol on the West Coast fell 5 cents, or 2.1 percent, to $2.375 a gallon and in New York the additive decreased 3.5 cents, or 1.5 percent, to $2.32, according to data compiled by Bloomberg.
Ethanol in Chicago slid 2 cents, or 0.9 percent, to $2.23 a gallon and in the U.S. Gulf the fuel lost 0.5 cent to $2.295.
Corn for May delivery fell 10.5 cents, or 1.7 percent, to $6.2025 a bushel in Chicago. One bushel makes at least 2.75 gallons of ethanol.
Gasoline for April delivery fell 1.01 cents, or 0.3 percent, to settle at $3.3955 a gallon on the New York Mercantile Exchange. The contract covers reformulated gasoline, which is made to be blended with ethanol before delivery to filling stations.
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